New York Markets After Hours

Texas to pay $10,000 for each Toyota job relocated

MikeRamsey

Toyota Motor Corp. plans a sweeping shake-up of its U.S. operations, consolidating several units at a new headquarters in Plano, Texas, that will house about 4,000 people and serve as the hub for its North American marketing, manufacturing and finance operations.

Executives will start moving from the company's U.S. marketing operations headquarters in Torrance, Calif., as soon as July to leased facilities in the Dallas suburb while a new facility is constructed. The move into the new building should be finished by late 2016 or early 2017, the company said.

In addition to most of its California operations, Toyota will shift business units located in New York and Kentucky to the new facility. Toyota has corporate offices in New York that handle financial matters and has its North American manufacturing headquarters in Erlanger, Ky. Manufacturing purchasing will relocate to its Toyota Technical Center in York Township, Mich., the company said.

The sweeping reorganization is part of a larger effort by Toyota to cut costs and run its North American business as a cohesive operation. Until last year, its sales and marketing, manufacturing and research and engineering were distinct units with their own headquarters and top executives.

Toyota has been hunting for a new headquarters that would accommodate its three now separate business units, people familiar with the matter said. The California operations were too far from most of the company's other U.S. business units.

Toyota narrowed its city locations to Denver, Charlotte and Atlanta, before choosing Texas, which offered a rich incentive package to lure Toyota, the people said.

Real-estate firm Jones Lang LaSalle handled the search.

Toyota's U.S. sales unit has been based in Southern California since 1957. Toyota has expanded its operations in the area to include product planning, vehicle design, consumer finance and logistics. The auto maker also has a small manufacturing operation in Long Beach, Calif.

The company confirmed the move to Texas on Monday.

The auto maker also said it would restructure its marketing organization. It said staff "whose positions are significantly different in the new organization have been provided with several options, including applying for opportunities within the new marketing organization or in other departments at...Toyota Financial Services."

Toyota has operations around the U.S., including vehicle assembly factories in Kentucky, Indiana, Texas and Mississippi. It has a large technical center in Ann Arbor, Mich.

California has long been the mainstay of Toyota's U.S. sales, as the state is for rival Asian auto makers. The Japanese auto maker's decision to relocate is a blow to California, and a victory for Texas Gov. Rick Perry, who has been campaigning aggressively to persuade more companies to quit the Golden State and move to Texas.

The high cost of living and high taxes in the Los Angeles area have led some of Toyota's rivals to shift jobs out of the area.

Nissan Motor Co. moved its U.S. headquarters from Gardena, Calif., to Nashville, Tenn., in 2006. Honda Motor Co. last year moved a small number of top-level employees from its neighboring Torrance campus to a suburb of Columbus, Ohio, where the company has research-and-development operations and large manufacturing facilities.

Torrance Mayor Frank Scotto said on Saturday, "We've done everything over the years to support Toyota," he said. "This decision isn't something you make on a Friday afternoon and announce on Monday--this has been going on for a while."

Write to Mike Ramsey at michael.ramsey@wsj.com and Joseph B. White at joseph.white@wsj.com

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Toyota Motor Corp. plans a sweeping shake-up of its U.S. operations, consolidating several units in to a new headquarters in Plano, Texas, that will house 4,000 people and serve as the hub for its North American marketing, manufacturing and finance operations.

Toyota confirmed the moves on Monday.

Executives will start moving from the company's U.S. marketing operations headquarters in Torrance, Calif., as soon as July to leased facilities in the Dallas suburb while a new facility is constructed. The building should be finished by the end of 2016, a person familiar with the matter said. Toyota said its financial services operations will move to Plano in 2017.

Toyota North America chief executive Jim Lentz said in a statement that consolidating the company's major business units will help to "speed decision making, share best practices and leverage the combined strength of our employees." Mr. Lentz characterized the move as "the most significant change we've made to our North American operations in the past 50 years."

As part of the reorganization, Toyota said it will move 250 purchasing jobs to its technical campus in Ann Arbor, Mich., from a site in the Cincinnati suburb of Erlanger, Ky.

In addition to most of its California operations, Toyota will shift business units located in New York and Kentucky to the new facility. Toyota has corporate offices in New York that handle financial matters and has its North American manufacturing headquarters in Erlanger, Ky. Manufacturing purchasing will relocate to its Toyota Technical Center in York Township, Mich., the company said.

The sweeping reorganization is part of a larger effort by Toyota to cut costs and run its North American business as a cohesive operation. Until last year, its sales and marketing, manufacturing and research and engineering were distinct units with their own headquarters and top executives.

Toyota has been hunting for a new headquarters that would accommodate its three now separate business units, people familiar with the matter said. The California operations were too far from most of the company's other U.S. business units.

Toyota narrowed its city locations to Denver, Charlotte and Atlanta, before choosing Texas, which offered a rich incentive package to lure, Toyota, the person familiar with the matter said.

Real-estate firm Jones Lang LaSalle handled the search.

Toyota's U.S. sales unit has been based in Southern California since 1957. Toyota has expanded its operations in the area to include product planning, vehicle design, consumer finance and logistics. The auto maker also has a small manufacturing operation in Long Beach, Calif.

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